Professional Documents
Culture Documents
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ITEM PIN
(OR EQUAL) DESCRIPTION QTY PRICE PER UNIT
EXTENDED PRICE
1 18-E80S-21 BATTERY FORKLIFT QTY: 10
2 18-E80S-27 BATTERY, GEL, MAINT FREE FOR 10K
FORKLIFT, QTY: 4 EA
(R4, tab 5 at 1-2) The name ofthe manufacturer (brand) was not included in the
solicitation, however, appellant agrees that the part numbers "correspond to batteries
manufactured by EnerSys, Inc." (R4, tab 8 at 2; app. opp'n at 2, ~ 4).
2. The solicitation incorporated by reference FAR 52.211-6, BRAND NAME OR
EQUAL (AUG 1999), that includes the following language:
(a) If an item in this solicitation is identified as "brand
name or equal," the purchase description reflects the
characteristics and level of quality that will satisfy the
Government's needs. The salient physical, functional, or
performance characteristics that "equal" products must meet
are specified in the solicitation.
(d) Unless the offeror clearly indicates in its offer that the
product being offered is an "equal" product, the offeror shall
provide the brand name product referenced in the solicitation.
(R4, tab 5 at 3)
3. The solicitation, as modified, listed the following salient characteristics:
Batteries must fit in both Hyster E40XM and E60XM
forklifts without modifications to either forklift.
Batteries must be VRLA (Valve Regulated Lead Acid) type
(maintenance free).
Batteries must be "Shock Hardened"
17 at 6-7)
8. The record includes a copy of the lOA signed by Mr. Walko on 3 November
2011 and by Mr. Miller, Pulaski Bank, on 3 November 2011 and an NOA signed by
Ms. Lieson, Bibby Financial Services, on 8 December 2011 and by the MSFSC
contracting officer on 9 December 2011 (R4, tab 22).
9. On 7 February 2012, Jayco issued a purchase order to Interstate PowerCare
SoCal, Garden Grove, California, for ten Hawker 18-751EL-21EE4 and four Hawker
18-75IEL-27EE batteries (gov't mot., ex. C).
10. On 9 February 2012, Mr. Walko emailed Mr. Jennings, supervisory contract
specialist, MSFSC, and informed him that the batteries would be shipped on 13 March
2012 (R4, tab 12 at 11). Mr. Jennings responded to Mr. Walko on the same day stating:
We have spoken with the battery manufacturer, EnerSys,
about the availability/status of batteries. EnerSys says they
have no batteries in stock and none in the pipeline. Are you
sure you are providing the correct batteries?
(R4, tab 12 at 11) Mr. Walko replied, "[a]bsolutely" (id.).
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have not placed an order with them and they have no batteries
in stock. ...
(R4, tab 12 at 14) Mr. Jennings went on to state that "[i]n order to ensure the batteries
are acceptable" he would send an engineering representative to inspect the batteries at the
vendor's facility at no cost to Jay co. He asked for vendor contact information and said he
would modify the contract to add the on-site inspection. (!d.) He stated, "[t]he
Government will not be obligated to pay for batteries that are shipped here and
determined to be unacceptable upon inspection" (id. ). He ended by stating, "[y]ou have
been granted more than enough time to complete this requirement. My only other option
is to terminate for cause." (!d.)
13. On 23 February 2012, Mr. Walko responded:
Thought that I had answered your question. Yes, we are
providing Enersys manufactured batteries. They are
manufactured at Enersys/Hawker's forklift battery plant in
Tennesee [sic], Cage Code (3C3B9). Hawker is a division or
subsidiary ofEnersys ....
I understand that you must ensure that the parts meet the
government's requirements and am pleased that you want to
do a QAR inspection. I will get POC information to you later
today or tomorrow but wanted to get this response off to you
right away ....
Enersys and Enersys/Hawker batteries are physically the
same dimensions, same technology and they both use the
same cells to make the batteries. Both are SHOCK
HARDENED, SPARKPROOF TRAY, and VRLA and they
both are made for the E40XM and E60XM ....
Our batteries can be inspected at the plant's Cage Code
address (3C3B9) and they will be shipped, packaged to your
specifications, with a Certificate of Conformance, direct from
the plant to San Diego.
(R4, tab 12 at 13-14)
14. In early March 2012 the government prepared to conduct the inspection on
23 March 2012 at the Hawker facility (R4, tab 12 at 18).
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Interstate PowerCare was identified as the billing address (R4, tab 15).
Mr. Hughes memorandum incorrectly states that in addition to the 18-75-EL-21EE
batteries that 18-75-EL-27EE batteries were received. The shipping documents
(R4, tab 15) and pictures of the batteries (R4, tab 16 at 11) prove that only the
21EE batteries were received.
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This is the first document that identified Mr. Jennings as the CO rather than a
supervisory contract specialist. In a 15 June 2012 email he was still identified as a
supervisory contract specialist (R4, tab 12 at 31). It is unclear from this record
precisely when he became a CO.
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Procedural History
On 6 March 2013, the government filed its original motion for summary judgment.
Jayco filed its opposition and motion to continue the government's motion on 11 April
2013. The motion to continue essentially took the position that Jayco had not had
sufficient time to conduct discovery to defend against the motion for summary judgment.
On 23 April2013, the government withdrew its motion for summary judgment to allow
Jayco an opportunity to conduct discovery. On 7 November 2013, the government
refiled its motion for summary judgment. On 20 December 2013, Jayco filed its
opposition. On 16 January 2014, the government replied to the opposition. From this
history we see that J ayco had six months to conduct discovery between the time the
government withdrew its original motion for summary judgment on 23 April 2013 and
refiled on 7 November 2013. We therefore conclude that Jayco has had sufficient time to
conduct additional discovery to defend against the government's motion.
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Although 8440 was issued as a unilateral purchase order (PO), we conclude that the
government's insistence that Jayco sign the purchase order and Mr. Walko's
signature converted the unilateral PO to a bilateral contract (SOF ~ 5).
Hawker is a subsidiary ofEnerSys (SOF ~ 13).
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question of fact. However, whether the contract was modified is a mixed question of fact
and law. We must therefore scrutinize the emails and conversations Jayco relies upon,
and other facts in the record, to decide if the contract was modified to allow Jayco to
tender "or equal" batteries. First, however, we consider an assignment of claims issue
raised by Jayco.
Assignment of Claims
On 8 July 2011, Jayco ordered ten 18-E80S-21EE and four 18-E80S-27EE
SmartHog batteries from EnerSys (SOF ,-r 6). Between July 2011 and December 2011 the
parties discussed delivery and financing (SOF ,-r,-r 7, 8). On 7 February 2012, Jayco
ordered Hawker batteries from PowerCare SoCal (SOF ,-r 9). In a 17 February 2012
email, Jayco asserts that the government took "many months (instead of a few days)" to
complete Jayco's assignment of claim documents and as a result the EnerSys batteries it
had ordered and were waiting to be delivered were "taken by the government" (SOF
,-r 11). In its opposition, supported by Mr. Walko's declaration, Jayco contends that the
Navy delayed approving its assignment of claims 10 and as a result the Navy purchased
EnerSys batteries that had been set aside for Jayco's contract:
The request for assignment of Contract payments was
initiated by Jayco in September 20 11. For reasons unknown
to Jayco, the Navy delayed the assignment of payments for
several months and did not approve the assignment until on or
about January 2012.
During the time that the Navy delayed approving the
assignment of Contract payments, the Navy requested, and
Jayco agreed, that EnerSys could provide to the Navy the
batteries that had been reserved for J ayco' s use in fulfillment
of the Contract. The Navy's procurement of such batteries
were separate from the procurement related to the Contract.
Due to the Navy's delay in approving the assignment of
Contract payments, as well as the Navy's request to take the
batteries reserved by EnerSys for use under the Contract, it
became necessary for J ayco to fulfill the Contract with
batteries that were equal to or better than the brand-name
EnerSys batteries.
(App. opp'n at 3, ,-r 10, ex. 1, Walko decl. ,-r,-r 15-17) We view this as a contention that the
Navy interfered with Jayco's performance.
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Contract Modification
On 8 July 2011 Jayco issued a purchase order to EnerSys, Reading, Pennsylvania,
for ten 18-E80S-21EE SmartHog batteries and four 18-E80S-27EE SmartHog batteries
(SOF ~ 6). On 7 February 2012, Jayco ordered Hawker batteries from Interstate
PowerCare SoCal in California (SOF ~ 9). 12 Two days later, the Navy, after checking
with EnerSys and learning they had no batteries in stock and none in production, asked
Jayco if they were providing the "correct batteries" (SOF ~ 10). Mr. Walko responded,
without elaboration, "absolutely" (id.). On 17 February 2012 the Navy again inquired if
Jayco was supplying the EnerSys batteries specified in the contract (SOF ~ 11).
Mr. Walko responded the same day and for the first time informed the Navy that Jayco
was providing "or equal" batteries {id. ). In that 17 February 2012 email, Mr. Walko
asked Mr. Jennings to "issue a modification clarifying the above description and PIN's as
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The government argues, "[m ]ere conclusory assertions do not raise a genuine issue of
fact" (gov't reply at 4) (citing Pure Gold, Inc. v. Syntex (USA.), Inc., 739 F.2d
624, 626-27 (Fed. Cir. 1984).
The existing record of what transpired between 8 July 2011 and 7 February 2012 does
not adequately explain the reason for the second order.
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stated" (id.). On 22 February 2012, Mr. Jennings responded but that response was
equivocal. Mr. Jennings did not demand that EnerSys batteries be delivered as he had
before. Instead, after being told that Jayco intended to supply "or equal" batteries,
Mr. Jennings stated he "must ensure the parts you are preparing to ship will meet the
Government's requirement" and he said he would send an engineer representative to
inspect the batteries at the vendor at no cost to Jayco. (SOF ~ 12) While Mr. Jennings
indicated a willingness to consider "or equal" batteries, he did not agree to "issue" a
written modification to the contract as requested.
On 23 February 2012, Mr. Walko provided a response stating "we are providing
Enersys manufactured batteries" and that "Enersys and Enersys/Hawker" batteries are
"physically the same" (SOF ~ 13). Mr. Walko stated he would provide a POC at the
vendor's facility to facilitate a government inspection (id.). In early March 2012 the
government prepared to have Mr. Hughes, MHE program manager, and a representative
from Hyster (fork lift manufacturer) conduct an inspection of the batteries Jayco intended
to deliver on 23 March 2012 at the Hawker facility in Tennessee (SOF ,-[ 14). On
12 March 2012, five Hawker Envirolink 018-075EL-21 batteries were shipped by
Hawker Powersource, Inc., Ooltewah, Tennessee, to MCS BATS Warehouse,
San Diego, California (SOF ,-[ 15). The inspection of the Hawker batteries was scheduled
for 23 March 2012 at the Hawker plant in Chattanooga, Tennessee. As Mr. Hughes and
the Hyster representative were in route to Chattanooga, Hawker informed them by phone
and email that the batteries had been mistakenly shipped and were not available for
inspection (SOF ,-[ 16). This was ten days after the batteries had been shipped to the
Navy. There is no explanation in the record as to why Mr. Walko and/or Hawker did not
inform Mr. Hughes, well before he commenced travel to Chattanooga, that the batteries
were no longer there. Mr. Hughes was initially told that the Hawker plant manager
would not see him, but was able to meet with the plant manager and others even though
he could not inspect the batteries. Mr. Hughes reported in his 31 August 2012
memorandum that he learned from the Hawker representatives that the Hawker batteries
were not equal to the EnerSys shipboard batteries (SOF ,-[ 16).
On 26 March 2012, Mr. Walko informed Mr. Jennings that Mr. Hughes'
inspection could not take place because the batteries, contrary to his instructions, had
been shipped (SOF ~ 17). Mr. Walko stated he was in the process of having them
returned for inspection (id. ). This, however, was six days after the Hawker batteries
arrived at the Navy Warehouse in San Diego (SOF ,-[ 15). None of this give and take on
the inspection is adequately explained in the record, but sending Mr. Hughes to inspect
the Hawker batteries could be consistent with the modification alleged by Jayco.
A bilateral modification to a contract must satisfy all of the elements of contract
formation: mutual intent to contract including an offer; an acceptance; consideration; and
actual authority on the part of the government representative. Northrop Grumman
Systems Corp. Space Systems Division, ASBCA No. 54774, 10-2 BCA ,-[ 34,517 at
170,235, 170,237. In order to meet this burden Jayco relies upon the emails discussed
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above and a declaration by Mr. Walko asserting, "[b]ased upon multiple conversations
between myself and Ricky Jennings, Contracting Officer for the Contract, the parties
agreed that the Contract was modified to permit delivery of the Hawker Batteries subject
to inspection to confirm their status as 'or equal' to the EnerSys batteries" (app. opp'n,
ex. 1, Walko decl. at 3, ~ 19). Mr. Walko testified similarly in his deposition (app. opp'n
ex. 3 at 51). Mr. Walko provides few details ofthe conversations he states he had with
CO Jennings. The Navy responds to Mr. Walko's testimony, just as it did before, with
mere contentions by government attorneys. The government argues there is no evidence
indicating that the CO had agreed to substitute Hawker batteries for EnerSys batteries
(gov't reply at 9); however, Mr. Walko's testimony is evidence. The government
presents no declaration or affidavit or cite to deposition testimony from CO Jennings
disagreeing with Mr. Walko's testimony. Had there been, again an issue of credibility
would exist. Since all inferences must be drawn in favor of Jay co, we must credit
Mr. Walko's testimony, uncontested by sworn testimony from CO Jennings, that he and
CO Jennings agreed to the change in conversations. 13 The record on this point is
insufficient for the Board to grant summary judgment in favor of the Navy.
CONCLUSION
For the reasons stated above, the government's motion is denied.
Dated: 12 February 20 14
Administrativ Judge
Armed Servic s Board
of Contract Appeals
I concur
I concur
~~~ ~/}
Administrative Judge
Acting Chairman
Armed Services Board
of Contract Appeals
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Administrative Judge
Acting Vice Chairman
Armed Services Board
of Contract Appeals
The government asserts that only a written change would suffice (gov't reply at 9), but
it ignores well established legal support for the possibility of oral or constructive
changes. Elter S.A., ASBCA No. 52349 et al., 01-2 BCA ~ 31,547 at 155,809-10;
Gray Personnel, Inc., ASBCA Nos. 54652, 55833, 13 BCA ~ 35,211 at 172,763.
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,
I certify that the foregoing is a true copy of the Opinion and Decision of the
Armed Services Board of Contract Appeals in ASBCA No. 58461, Appeal of Jayco
International, LLC, rendered in conformance with the Board's Charter.
Dated:
JEFFREY D. GARDIN
Recorder, Armed Services
Board of Contract Appeals
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